Fact based stock research
Credit Acceptance (NasdaqGS:CACC)
US2253101016
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Credit Acceptance stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 11 (worse than 89% compared with investment alternatives), Credit Acceptance (Consumer Finance, USA) shares have lower financial characteristics compared with similar stocks. Shares of Credit Acceptance are low in value (priced high) with a consolidated Value Rank of 16 (worse than 84% of alternatives), and are riskily financed (Safety Rank of 1, which means above-average debt burdens) but show above-average growth (Growth Rank of 73). ...read more
RECOMMENDATION: A Combined Rank of 11, is a sell recommendation based on Credit Acceptance's financial characteristics. As the company Credit Acceptance shows low value with an Obermatt Value Rank of 16 (84% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 73% of comparable companies (Obermatt Growth Rank is 73). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 1 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Credit Acceptance, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Consumer Finance |
| Index | NASDAQ |
| Size class | Large |
18-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Credit Acceptance
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 18 |
|
13 |
|
16 |
|
16 |
|
| GROWTH | ||||||||
| GROWTH | 90 |
|
63 |
|
7 |
|
73 |
|
| SAFETY | ||||||||
| SAFETY | 32 |
|
10 |
|
15 |
|
1 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
3 |
|
8 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
5 |
|
1 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 11 (worse than 89% compared with investment alternatives), Credit Acceptance (Consumer Finance, USA) shares have lower financial characteristics compared with similar stocks. Shares of Credit Acceptance are low in value (priced high) with a consolidated Value Rank of 16 (worse than 84% of alternatives), and are riskily financed (Safety Rank of 1, which means above-average debt burdens) but show above-average growth (Growth Rank of 73). ...read more
RECOMMENDATION: A Combined Rank of 11, is a sell recommendation based on Credit Acceptance's financial characteristics. As the company Credit Acceptance shows low value with an Obermatt Value Rank of 16 (84% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 73% of comparable companies (Obermatt Growth Rank is 73). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 1 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Credit Acceptance, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 18 |
|
13 |
|
16 |
|
16 |
|
| GROWTH | ||||||||
| GROWTH | 90 |
|
63 |
|
7 |
|
73 |
|
| SAFETY | ||||||||
| SAFETY | 32 |
|
10 |
|
15 |
|
1 |
|
| COMBINED | ||||||||
| COMBINED | 39 |
|
8 |
|
1 |
|
11 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 16 (worse than 84% compared with alternatives), Credit Acceptance shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Credit Acceptance. Only Price-to-Profit (also referred to as price-earnings, P/E) indicates good stock value with a rank of 50, which means that the stock price compared with what market professionals expect for future profits is lower than for 50% of comparable companies, indicating a good value concerning Credit Acceptance's profit levels. But Price-to-Sales is 37 which means that the stock price compared with what market professionals expect for future profits is higher than for 63% of comparable companies, indicating a low value concerning Credit Acceptance's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 17 and for dividend yield, which is lower than for 99% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 16, is a sell recommendation based on Credit Acceptance's stock price compared with the company's operational size and dividend yields. Can we rely on only one good value indicator? Only if we know the company well. In this case, a high Price-to-Profit Rank, while Price-to-Sales and Price-to-Book are both below the market typical levels, means that the company can charge higher prices for its products and needs less capital to produce them. If this is sustainable, then Credit Acceptance is a good investment because profits count most in enterprise valuations. The low dividend yield indicates that the company is confident it can do something with the generated cash that is more valuable than paying the profits out to the shareholders in the form of dividends. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 36 |
|
37 |
|
41 |
|
37 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 60 |
|
52 |
|
44 |
|
50 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 12 |
|
17 |
|
21 |
|
17 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 1 |
|
1 |
|
1 |
|
1 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 18 |
|
13 |
|
16 |
|
16 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 73 (better than 73% compared with alternatives), Credit Acceptance shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Credit Acceptance. Sales Growth has a value of 54 which means that currently professionals expect the company to grow more than 54% of its competitors. Profit Growth with a value of 90 and Capital Growth with a rank of 64 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 39, which means that stock returns have recently been below 61% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 73, is a buy recommendation for growth and momentum investors. Credit Acceptance has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Credit Acceptance, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 83 |
|
8 |
|
12 |
|
54 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 1 |
|
89 |
|
10 |
|
90 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
44 |
|
52 |
|
64 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 84 |
|
87 |
|
29 |
|
39 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 90 |
|
63 |
|
7 |
|
73 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 1 (better than 1% compared with alternatives), the company Credit Acceptance has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Credit Acceptance is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for Credit Acceptance. Liquidity is at 30, meaning that the company generates less profit to service its debt than 70% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 25, meaning the company has an above-average debt-to-equity ratio. It has more debt than 75% of its competitors. Finally, Refinancing is at a rank of 3 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 97% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 1 (worse than 99% compared with alternatives), Credit Acceptance has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of Credit Acceptance because it may suffer significantly in case of future difficulties. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 22 |
|
34 |
|
27 |
|
25 |
|
| REFINANCING | ||||||||
| REFINANCING | 59 |
|
7 |
|
13 |
|
3 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 33 |
|
35 |
|
50 |
|
30 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 32 |
|
10 |
|
15 |
|
1 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
5 |
|
7 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
23 |
|
50 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
55 |
|
64 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
1 |
|
5 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
3 |
|
8 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for Credit Acceptance from April 18, 2024.
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